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Report: 1 in 6 working Iowa households cannot meet basic needs

(File photo) A house Wellington Heights neighborhood of Cedar Rapids. (Liz Martin/The Gazette)
(File photo) A house Wellington Heights neighborhood of Cedar Rapids. (Liz Martin/The Gazette)

The latest report on the cost of living in Iowa finds that one in six Iowa households struggle to pay their bills.

The latest Iowa Policy Project Cost of Living in Iowa report, released Monday, found that nearly 100,000 Iowa working households — about 227,000 people in total — earn too little for basic needs.

“Most working families need to earn more than twice the poverty level to get by. That’s significant because the poverty level is a standard for eligibility for various kinds of public assistance,” said Peter Fisher, IPP research director.

The report takes a look at 2017 cost-of-living data that includes the cost of rent and utilities, food, transportation and taxes. The report uses 2018 data for health care expenses.

While some costs have declined slightly — including transportation — since IPP’s last report in 2016, housing and health care costs have climbed, Fisher said.

While last week’s United Way 2018 ALICE — Asset-Limited, Income-Constrained, Employed — report included all Iowa households, the IPP report focuses on working households, or those with at least one full-time worker.

The ALICE report found that 457,044 Iowa households, or 37 percent of the state’s total, are unable to meet basic needs.

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Meanwhile, the IPP report notes that around 100,000 working households, or about 17 percent statewide, do not earn enough to meet “a basic-needs, no-frills, self-sufficiency budget.”

In addition, the report found that single parents make up 62.1 percent of Iowa households below the basic needs level. The average single-family household makes about $20,000 less in actual income than they need to be self-sufficient, the report noted.

“You can see that large disparity with single parent households,” said Natalie Veldhouse, research associated with IPP.

The report noted that 16 percent of white working households are below the self-sufficiency line, compared to 28 percent Hispanic households and 30 percent black households.

All told, white households make up the largest number of households below the self-sufficiency mark.

Fisher added that his hope is the report helps guide state policy, noting recent action by state officials and by the Iowa Legislature, including Medicaid privatization and the abolishment of local minimum wage increases, have hurt low-income residents.

“It should be a call to policymakers that we need to pay attention to basic economic situations facing citizens in Iowa,” Fisher said.

The annual total basic expenses, according to the IPP report, for the Corridor are:

Linn County

l Single individual — $20,115

l Single parent with one child — $36,159

l Two working parents with two children — $54,698

Johnson County

l Single individual — $21,776

l Single parent with one child — $39,630

l Two working parents with two children — $59,053

l Comments: (319) 398-8309; mitchell.schmidt@thegazette.com

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